Chee Hong Tat: Remarks - Equities Market Review Group media conference

A Well-Functioning Equities Market

Good evening. Thank you for attending today's media conference. I am joined here today by our Equities Market Review Group and Workstream members, who have contributed to the review process which started in August last year.

Over the past year, our shared goal has been to strengthen Singapore's equities market as a well-functioning, trusted, and vibrant platform for enterprises and investors.

To build a stronger equities market, we know it cannot be achieved by any single organisation, and there is no single silver bullet to tackle this set of challenges. It takes an entire ecosystem – the regulator, exchange, intermediaries, investors, and listed companies themselves.

Hence, the Review Group consulted widely and considered different views from various stakeholders, to strengthen our equity market holistically.

Early signs of momentum

There have been some encouraging developments since the beginning of the review.

a. Singapore's equities market has performed well. We have seen increased trading activity supported by both institutional and retail participation, and underpinned by increased activity in small- and mid-cap stocks.

b. The average daily turnover in the third quarter of this year rose by 16% year-on-year to more than S$1.5 billion, which is the highest since the first quarter of 2021.

c. This year, the number of IPOs picked up significantly, with total funds raised increasing from a low base in the previous year to more than S$2 billion.

d. SGX has also shared a healthy pipeline of companies that are planning to list, and is actively engaging with more firms to consider Singapore as a venue to raise capital. The Review Group's measures will complement these efforts.

Further Measures to Strengthen Singapore's Equities Market 

Earlier in February this year, we introduced the first set of measures addressing demand, supply, regulatory, and connectivity, with a progress update in July. The Review Group has now completed our work, and the new measures we are announcing today will build on earlier progress.

Allow me, on behalf of the Review Group, to share on four key developments.

a. First, against the current global backdrop, we need to build more bridges. We will continue to strengthen cross-border partnerships to advance market connectivity.

i. As part of our work, the Review Group has encouraged and facilitated the proposal by SGX and Nasdaq to launch a new dual listing bridge that connects Singapore and the United States (U.S.). This is an innovative collaboration between two major financial ecosystems, and as the name suggests – it is a bridge which will enable issuers and investors alike to access liquidity simultaneously across both markets.

ii. This is aimed at meeting the needs of growth companies with market capitalisation of S$2 billion and above, with an Asian nexus in terms of their operations and global ambitions in terms of their growth plans, to raise capital efficiently from investors in both markets. These companies, we hope, will be able to benefit from increased brand recognition among Asian investors while accessing the deep capital pool in the US. Various measures that have been introduced so far, including the Equity Market Development Programme (EQDP) and Anchor Fund, will also provide support for their fundraising efforts on this new Board.

iii. To support dual listings under this arrangement, the regulatory obligations for prospective issuers that list on this platform will be streamlined, allowing issuers to use a single set of offering documents and undergo a simplified review process.

iv. With the draw of both US and Singapore liquidity pools, the new Board will support efforts to attract more Asian issuers into the Singapore ecosystem, including from sectors that are less represented in our market today.

v. This expanded sector coverage, such as the tech sector, will draw new investor segments to Singapore, which would support efforts to rejuvenate our equity, trading, research and related professional services ecosystem.

vi. The new Board is envisaged to go live around mid-2026. SGX and Nasdaq will share more on this initiative separately in their joint press release.

b. Second, as I shared at the SID Directors' Conference in September, companies must take proactive steps to unlock and demonstrate their value.

i. To facilitate this – MAS, through the Financial Sector Development Fund (FSDF), will allocate S$30 million to a "Value Unlock" Programme to support listed companies in strengthening shareholder engagement and developing strategies for longer-term value creation.

ii. Our "Value Unlock" Programme will build on three reinforcing pillars:

1. First, MAS will provide grants to support companies' investment in building capabilities in the areas of corporate strategy, capital optimisation, and investor relations, enabling them to articulate compelling value propositions.

2. Second, MAS will work with SGX to help companies amplify their communications and market presence, through investor outreach events, media features and enhanced research coverage. This will give investors clearer insights into the company's business fundamentals and growth prospects.

3. Third, we will work with ecosystem partners to foster communities for collaboration, peer learning and to drive a positive momentum of value creation across the market.

iii. Together, I hope these efforts will foster a market culture where companies view listing not as an end point, but as a continuing journey and partnership with investors focused on sustainable growth.

c. Third, MAS will place a combined sum of S$2.85 billion under EQDP Phase II with six asset managers.

i. In February this year, MAS launched the EQDP to develop our local fund management industry and to increase investor participation in Singapore equities. In July, we announced the first batch of managers with a total of S$1.1 billion allocation.

ii. The appointment of this second batch will bring total allocations under both phases to S$3.95 billion, out of the S$5 billion set aside for the programme.

iii. Taken together, this diverse mix of local, regional, and global managers were appointed to tap their complementary expertise and distribution networks. We believe this will help attract a broader investor base to Singapore's equities market. For these managers, they will also be crowding in private capital, in addition to MAS' capital. This approach supports the growth of our local fund management industry and enhances local market liquidity.

iv. MAS continues to review submissions, with the next phase of selection expected by the second quarter of 2026.

d. Finally, we will improve trading and custody efficiency, through three key measures.

i. First, MAS and SGX will introduce incentives to improve market making for newly listed IPOs and a targeted set of next-tier small- and mid-cap stocks outside the STI - companies that can benefit from greater institutional interest. A stronger market-making ecosystem will translate into tighter trading spreads, and better execution quality. For investors, this translates into lower costs, more efficient price discovery, and greater confidence in our market. For issuers, it will mean better liquidity. These are some of the benefits that will come together with the measure. We will share further details in the first quarter of 2026.

ii. Next, SGX will modernise the Central Depository (CDP)'s post-trade custody model to facilitate wider investor adoption of broker custody accounts. This will enable the broader offering of value-added services for SGX securities to Singapore investors like portfolio management and fractional trading. The model also aligns with the practice in major markets and makes it easier for international asset managers to invest in Singapore's equities market. Retail investors will have the option of choosing these broker custody accounts or, if they prefer, keep their CDP direct accounts if they wish to do so. We are giving them the option to decide.

iii. Third, SGX will reduce the board lot size for securities priced above S$10 from 100 units to 10 units. This lowers the minimum investment amount for such shares, making the market more accessible to all investors.

Public-private collaboration to co-create measures

Ladies and gentlemen, this review has been a collaboration between the government and our industry partners. I want to stress that we wouldn't have been able to do this alone. The Review Group and the two workstreams conducted numerous engagements with a wide range of market participants. This included fund managers, brokers, market practitioners, business leaders from listed companies, founders of pre-IPO companies who are looking to list over the medium term, and different industry groupings and associations. I want to thank them for their contributions – this has been an important source of feedback and ideas.

The global environment remains uncertain. But through this exercise, we have gained valuable experience, forged stronger partnerships, and made meaningful progress. This spirit of consultation and collaboration between the private and public sectors, is one we must carry forward. Doing so will better position us to continue finding new growth areas in a more turbulent world.

But we must also be prepared to take some calculated risks to enhance the competitiveness of our ecosystem. We want to increase our chances of implementing transformative changes. We may not always succeed when we try, there is a possibility that some of the ideas may not work. But if we don't try, our chance of success is zero. Like what our former Deputy Prime Minister Dr Goh Keng Swee said many decades ago – the only way to avoid making mistakes is not to do anything. And that, in the final analysis, will be the ultimate mistake.

It is in this context that I would like to extend my sincere appreciation to all Review Group and Workstream members. We spent many hours having thoughtful and at times intense discussions. I would also like to thank the many industry stakeholders as well as members of public with capital market experience, whom the Review Group engaged over the past months to solicit ideas and test our proposals. 

Driving continuous progress, implementation underway 

Even as the Review Group completes its review today, our efforts do not end here. Building a strong and vibrant equities market is a journey that will continue over the medium term. Markets are cyclical, and there will certainly be ups and downs, but we must continue to build on this momentum of strengthening our ecosystem competitiveness.

We will remain focused on effective and timely implementation to establish our markets on a more competitive and attractive footing.

a. We will build on what we have done so far. I am pleased to announce that MAS will establish an Equity Market Implementation Committee, co-chaired by MAS Managing Director Mr Chia Der Jiun and SGX CEO Mr Loh Boon Chye. The Committee will oversee implementation and identify additional measures to enhance effectiveness as market conditions evolve.

These efforts form important foundations for the journey ahead. In every challenge lies opportunity, and amidst times of turbulence and uncertainty, we will continue to build on Singapore's value proposition as a trusted financial centre.

Thank you everyone, and now – let me share some brief remarks in mandarin.